Contrasting Western Gas Equity Partners, (WGP) & Sprague Resources (SRLP)
Sprague Resources (NYSE: SRLP) and Western Gas Equity Partners, (NYSE:WGP) are both oils/energy companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, dividends, valuation, earnings, institutional ownership and profitability.
This table compares Sprague Resources and Western Gas Equity Partners,’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Western Gas Equity Partners,||16.96%||8.99%||4.69%|
This is a summary of recent ratings for Sprague Resources and Western Gas Equity Partners,, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Western Gas Equity Partners,||0||2||6||0||2.75|
Sprague Resources currently has a consensus price target of $33.00, indicating a potential upside of 33.06%. Western Gas Equity Partners, has a consensus price target of $50.50, indicating a potential upside of 37.30%. Given Western Gas Equity Partners,’s higher possible upside, analysts clearly believe Western Gas Equity Partners, is more favorable than Sprague Resources.
Valuation and Earnings
This table compares Sprague Resources and Western Gas Equity Partners,’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Sprague Resources||$2.39 billion||0.23||$10.16 million||$1.79||13.85|
|Western Gas Equity Partners,||$1.80 billion||4.46||$345.77 million||$1.65||22.29|
Western Gas Equity Partners, has higher revenue, but lower earnings than Sprague Resources. Sprague Resources is trading at a lower price-to-earnings ratio than Western Gas Equity Partners,, indicating that it is currently the more affordable of the two stocks.
Sprague Resources pays an annual dividend of $2.49 per share and has a dividend yield of 10.0%. Western Gas Equity Partners, pays an annual dividend of $2.15 per share and has a dividend yield of 5.8%. Sprague Resources pays out 139.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Gas Equity Partners, pays out 130.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sprague Resources has increased its dividend for 3 consecutive years and Western Gas Equity Partners, has increased its dividend for 2 consecutive years. Sprague Resources is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
22.0% of Sprague Resources shares are owned by institutional investors. Comparatively, 17.3% of Western Gas Equity Partners, shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Volatility & Risk
Sprague Resources has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, Western Gas Equity Partners, has a beta of 1.55, indicating that its share price is 55% more volatile than the S&P 500.
Western Gas Equity Partners, beats Sprague Resources on 9 of the 16 factors compared between the two stocks.
Sprague Resources Company Profile
Sprague Resources LP is engaged in the purchase, storage, distribution and sale of refined products and natural gas, and provides storage and handling services for a range of materials. The Company operates through four segments: refined products, which purchases a range of refined products, such as heating oil, diesel fuel, residual fuel oil, asphalt, kerosene, jet fuel and gasoline from refining companies, trading organizations and producers; natural gas, which purchases natural gas from natural gas producers and trading companies, and sells and distributes natural gas to commercial and industrial customers in the Northeast and Mid-Atlantic United States; materials handling, which offloads, stores and prepares for delivery a range of customer-owned products, including asphalt, clay slurry, coal and heavy equipment, and other operations, which include the purchase and distribution of coal, certain commercial trucking activities and the heating equipment service business.
Western Gas Equity Partners, Company Profile
Western Gas Equity Partners, LP is a limited partnership. The Company is formed to own approximately three types of partnership interests in Western Gas Partners, LP (WES). WES is an master limited partnership (MLP) engaged in the business of gathering, compressing, treating, processing and transporting natural gas, and gathering, stabilizing and transporting condensate, natural gas liquids (NGLs) and crude oil. WES provides these midstream services for Anadarko Petroleum Corporation (Anadarko), as well as for third-party producers and customers. Its assets and investments are located in the Rocky Mountains (Colorado, Utah and Wyoming), North-central Pennsylvania and Texas. The Bison treating facility treats and compresses gas from coal-bed methane wells in the Powder River Basin of Wyoming. MIGC, LLC receives gas from various coal-bed methane gathering systems in the Powder River Basin and the Hilight system, as well as from WBI Energy Transmission, Inc.
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